Bridge News, Taipei
Hwa Nan Commercial Bank (華銀), First Commercial Bank (?@銀), and Chang Hwa Bank (1?堸虓~銀|?, known as the "big three" commercial banks in Taiwan, reduced their month-on-month overdue loan (ODL) ratios in December.
Hwa Nan Bank decreased its figure by 0.18 percentage point to 6.09 percent, First Commercial Bank by 0.51 percentage point to 5.74 percent and Chang Hwa Bank cut its ODL ratio by 0.21 percentage point to 6.25 percent, executives from each bank said yesterday.
Banks are being required by the Ministry of Finance (MOF,
A First Commercial executive said the bank in December brought its overdue loan ratio back down to below end-April levels as required by the MOF. First Commercial's overdue loan ratio was 6.09 percent at the end of April.
"We are being forced to sacrifice earnings to clean up our books," he explained.
However, Hua Nan and Chang Hwa executives would not confirm newspaper reports that they have also reached their respective reduction targets in December.
Both Hua Nan and Chang Hwa executives, however, attributed large bad loan write-offs in December as the reason behind a drop in the overdue loan ratios.
Chang Hwa executives added that the bank also received unexpected real estate income in December, which helped to offset the cost of writing off bad loans.
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